ILA, USMX come to tentative terms on new six-year deal

Port labor accord is back with yesterday’s news that the International Longshoremen’s Association (ILA), the largest union of maritime workers in North America, and the United States Maritime Alliance (USMX), an alliance of container carriers, direct employers, and port associations serving United States-based East and Gulf Coasts, have come to a tentative agreement on new six-year contract.

Terms of the contract were not available at press time. But ILA officials said this contract is subject to ratification by its members at ports throughout the country and also by USMX membership as well. The contract currently in place between the parties expires on September 30, 2018.

“We have reached a tentative agreement on a six-year Master contract that is beneficial to both sides,” said Harold J. Daggett, ILA President and David F. Adam, Chairman of USMX, in a statement.

ILA added that roughly 200 Wage Scale delegates unanimously signed off on the new contract’s terms after two days of Master Contract negotiations in Delray Beach, Florida.  

Both ILA and USMX said they “encouraged local ILA and management groups to finalize local agreements by July 10, 2018, prior to full membership ratification votes by the ILA rank-and-file members and USMX.”

In March, a letter to ILA’s Daggett and USMX Chairman and CEO David Adam from various shipper groups stressed the need for the two sides to come to a deal.

“Reaching a contract extension before the current contract expires will provide supply chain stakeholders with the certainty they need for their operations,” the letter stated. “Supply chain disruptions arising out of previous contract negotiations are well documented. Such disruptions can have enormous adverse economic impacts. For example, disruptions on the West Coast caused marked shifts in business operations that benefitted East and Gulf Coast ports. Much of that new business has stayed on the East and Gulf Coasts, but could just as easily shift back to West Coast gateways, where a long-term contract is in place.”

And it added that even the threat of a disruption could have a negative economic impact on the Gulf and East Coast ports, especially if shippers and beneficial cargo owners believe that operations would have been slowed or shut down during peak shipping season in the fall.  As was the case in 2012, they noted that some industries would begin implementing contingency planning as early as this spring to ensure that cargo is not disrupted during peak shipping season in the fall. In the absence of negotiations, those contingency plans will definitely affect business at East and Gulf Coast container terminals, they said.

What’s more, this deal reached an agreement well in advance of the September 30 expiration date of the current deal, something that did not occur when the current deal was reached in 2012.

That negotiation process was marred by acrimony on both sides, which required months-long extensions and assistance from the United States Federal Mediation and Conciliation Service.

The main issues between the ILA and USMX in 2012 centered around how the ILA had to negotiate all Master Contract issues with the ILA Wage Scale Committee, which ILA President Harold Daggett said in an August letter to USMX leadership is a democratically-elected committee that USMX had declined to address despite Daggett’s overtures to do so.

Another issue had to do with technology. USMX’ Capo maintained that the ILA is demanding that management guarantee a job for any worker even if new technologies eliminate a need for that position. USMX also noted that the current Collective Bargaining Agreement at that time mandated that both sides negotiate over the impact new technology might have on the work force.